Software License Agreement

The software license agreement is designed to grant rights to the use of large application packages for lengthy periods, subject to the payment of a one-time or periodic usage fee. The licensed software usually consists of standardized program modules that are suitable for use by customers from a particular sector of industry or field of application. The programs can be adapted to the customer’s specific needs under an agreement for IT works and services or an IT-services agreement  (mandate relationship). The licensor may provide maintenance and support for the licensed software under a software maintenance agreement. The rights to the software are owned by the licensor or were granted to the licensor by the legal owner for the purpose of issuing licenses in accordance with this agreement.

Unlike a SaaS cloud service agreement, the licensee (customer) usually puts the software on a computer or has to copy it. In a SaaS deal, the software is hosted on the provider’s servers and the customer accesses it. Because the licensee (customer) places a copy on a computer – if it is on-premise software – the contract must include a copyright license.